Chinatown Tour - Part 4

June 10th, 2014
By

Erdman cover

Took awhile to get to this final installment of my Chinatown tour series, but hopefully, you'll see how it all comes together. At the end of the Honolulu Exposed Red Light tour in mid-May, my wife wanted to pick up a copy of Hawaii Business magazine because an old friend of ours, Dave Erdman, was featured on the cover as their Small Business Person of the Year (click here for that article). Isabel worked with him in marketing at Tropical Rent A Car, back when I moved here in 1985.

Dave co-founded the Direct Response Advertising & Marketing Association of Hawaii (DRAMAH for short) and that's how I met Isabel -- my future wife. The guy I replaced at Oahu Bindery & Direct Mail had been talking to Dave about starting this direct marketing association, so I stepped in for him (Paul Hilker, who became a minister). Dave roped Isabel into it as well since she was assisting him at Tropical, which spawned a bunch of successful entrepreneurs before that company bit the dust. He went on to create the PacRim Marketing Group, which focused on the Japanese visitor market initially. Dave is fluent in Japanese, even though he came from the Philadelphia area. Isabel wound up starting her own small publishing company, which put out the very successful Japanese Guide to Hawaii (eventually sold to Duane Kurisu, who owns a number of Hawaii publications and businesses -- including Hawaii Business magazine). Another Tropical alumnus, Jeff Hendrix went into advertising, and formed his own award-winning agency (Hendrix Miyasaki Shin, which merged with Core Group One).

It was a fun gang to hang out with, especially since Tropical RAC had great company outer island trips because they had a lot of "trade" with travel-related partners and sponsors. I was meeting with Dave and Isabel regularly to plan our DRAMAH seminars, which brought in internationally-respected direct marketing experts through Dave's connections -- primarily his dad, the late great Ken Erdman, who was one of the best direct mail copywriters in the business. Ken's books, articles and seminar talks taught me just about everything I know in regards to copywriting. Plus, our post-DRAMAH meetings pau hana sessions at bars and business mixers Downtown, led to me getting romantically involved with Isabel. So I hold Dave largely responsible for my marriage, now going on 29 years.

DRAMAH was an important and influential development in the local advertising and marketing scene. You had the major ad agencies, smaller marketing/graphics outfits, a few independent consultants, all vying for limited advertising dollars. Direct marketing represented a major shift in thinking from mass "branding" type saturation ads (mainly print and TV commercials) to targeted data-based approaches that emphasized tailored ads and pitches. DM people really were the first to use computers and build databases that could identify markets by key demographics -- right down to income, education levels, interests and so on. Needless to say, traditional Mad Men type ad agency people were skeptical... even resistant to much of what was espoused in our DRAMAH seminars. Why, you ask?

Well, the core tenet of direct response marketing is called A/B testing. To see what message works best, you create alternate ads and in the old days, mailed out test packages to similar sample groups. For big companies, a small test mailing might be 5,000 out of a mailing list that could have hundreds of thousands of subscribers or product buyers... or donors. Ready, fire, aim. You analyze the results, fine tune, test again, and eventually do a roll-out to the entire list. But for traditional ad agencies that spend the bulk of the client's money on big ad buys in the newspaper or on TV, they really can't afford to produce multiple commercials or print ad campaigns and pass that cost along to the client. Instead, they may rely on smaller focus group testing or just present a couple of options to the client and let them guess which will work best.

Now here's where DM enters the modern age. Remember I mentioned donors lists? The man behind some of those early mailing lists, Richard Viguerie, became a major player in politics -- specifically the Republican Party. They were masters at the targeted message and building databases for fundraising, which gave them a huge edge over Democrats until the Obama campaign brought in people who understood A/B marketing. If you were on the Obama email list, you no doubt received a number of donation requests -- each one maybe slightly different in what the headline or subject line said. That's because with today's powerful database tools, they can do instantaneous testing to see which appeals generate the most response simply by tweaking a few words or images. More and more online advertisers are doing the same. And it all began with direct mail.

Anyhow, we couldn't find a single copy of that Hawaii Business magazine with Dave on the cover in Downtown Honolulu! The only magazine shop on Fort Street Mall that had it in their window was closed for the weekend. Longs didn't have it and it was just mid-month. In Kailua, we couldn't find it in Safeway or Foodland either. We had to drive to Ala Moana and get a copy from the Barnes & Noble bookstore there. When my wife used to publish her Japanese visitor guide, she would often check the street racks in Waikiki to make sure they were being kept in stock by her distribution person -- because that's what the advertisers are paying for.

So the business take-away from this simple walkabout in search of a magazine is that you can have the most sophisticated online computer tools at your disposal for market research and advertising... but if you don't get out of the office and check things with your own eyes and ears, chances are you may miss the real reason your business isn't doing better.

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